Student financial aid allocations to Universities and FET Colleges 2014

1. Student financial aid allocations to Universities and FET Colleges 2014 Presentation to the Portfolio Committee on Higher Education and Training 19 February 2014

2. Overview 1 NSFAS mandate • 2014 Allocations to Universities & FET Colleges • Funding shortfall challenges • Funding shortfall 2014 • Student Debt • Claims in excess of allocations 2013 • Unfunded programmes e.g. Bachelor of Technology • Advance payments and registration fees

3. NSFAS mandate The mandate of NSFAS is to disburse funds to students at the 25 public universities and 50 (FET) colleges Applicants must meet the NSFAS eligibility criteria of financial need and academic ability to succeed Funding has increased significantly over the past 5 years: • R3,2 billion for 191 080 students in 2009 • R8,5 billion for about 400 000 students in 2013 • over R9,7 billion in 2014 for about 450 000 students • Despite these substantial increases, funding still falls far short of demand from eligible students • Disbursement to students is by universities and colleges, each with its own systems and procedures – 73 different systems

4. University Allocations 2014 R7 605 847 987 for 235 000 students

5. University Allocations 2014

6. FET College Allocations 2014 R2 107 743 900 for 210 000 students

7. FET College Allocations 2014

8. FET College Allocations 2014

9. Pilot programme funding shortfall indicators • In the pilot programme, challenges related to the provision of student financial aid become visible much earlier in the academic year, not at the end of the year or at the beginning of the following year. • These include the problems of: • Student historic debt • Prior year claims in excess of allocation • Current year funding shortfall • Unfunded programmes • The new student-centred model requires financial aid to be available at the time of admission

10. Funding challenges • Student historic debt • R230 million provided from the R1billion allocated by the National Skills Fund to pay student debt • Claims in excess of allocations 2013 • Universities - R370 million • FET Colleges R161 million • Funding shortfall 2014 • Estimated shortfall R2 billion for 50 000 students • Collecting data from institutions to quantify the funding shortfall for registered, unfunded and underfunded students • Unfunded programmes • leave senior students unfunded, including student leaders • Bachelor of Technology requires R500 million a year • Some universities use other funding for B Tech

11. Advance payments 2014 • NSFAS provides advance payments to universities and colleges • Universities - up to 30% of their annual allocation • Colleges – up to 10% of their annual allocation. • These upfront payments are based on requests by institutions and are funded from loan recoveries. • Upfront payments ensure, inter alia, that registration fees are not required from NSFAS students • Some universities still demand that NSFAS students pay registration fees • Universities advance payments 2014 Mangosuthu University of Technology R 43 750 000 University Western Cape R 44 506 321 University of Fort Hare R 45 286 886 Total R 133 543 207

12. Advance payments to FET colleges 2014

13. The doors of learning and culture shall be opened! Freedom Charter, 1955 Green Paper for Post School Education and Training, 2012